Contact Us
TempDev’s Glossary
Back to our glossary

Glossary Terms

What is Patient Encounter Costing (PEC)?

What is Patient Encounter Costing (PEC)?

Patient Encounter Costing (PEC) is a healthcare accounting method that seeks to overcome the reliance on averages and allow care delivery units to calculate marginal costs per visit. The PEC method modifies time-driven activity-based costing (TDABC) and supports efficient accounting practices by utilizing data points that are already collected by healthcare systems.   

The primary goal of PEC is to allow care delivery units to calculate the cost of a patient's visit based on the actual resources used rather than averages. The data necessary to calculate patient encounter costing is typically collected by human resources and the finance department. The rest will come from the electronic health record (EHR) system.  

Why Is PEC Better Than Traditional Accounting? 

Traditional cost accounting systems in healthcare share one downside: reliance on average costs. With those methods, a care delivery unit would add up its total costs for the day and divide it across all patients that visited that day, which makes it seem like each patient consumed equal resources.  

The less-than-ideal outcome of traditional methods is that they make it difficult to assess the cost when care delivery is changed. For instance, if the number of patient visits decreases, traditional methods will always make it appear as though the cost per visit is increasing. However, the actual resources used to deliver care are likely the same.   

Some of the accounting methods that share in these cons include the ratio of costs to charges (RCC) and relative value unit (RVU). While these methods adjust costs based on the type of service delivered, they still use all costs to assign an average to each patient encounter. As such, these methods are easy to implement but still fail to account for the relationship between cost and volume. Only PEC can reasonably support such calculations with ease. 

How TempDev Can Help With Patient Encounter Costing

TempDev’s team of experienced consultants, developers, and trainers are here to support enhanced accessibility, as well as customized features and templates. This gives you and your patients more control over data with improved transparency. 

As part of our streamlining process, we help you implement the Patient Portal, API, and other tools better to support safety, patient engagement, and security. From dashboards to automation and workflow redesign, TempDev offers the comprehensive resources and tools you need to implement PEC.

Contact us here or by calling us at 888.TEMP.DEV to improve your PEC.


Agree with our point of view? Become our client!

Please submit your business information and a TempDev representative will follow up with you within 24 hours.

Hello! I’m the assistant Twinkie.

If you want to know more about TempDev please fill in your contact information below.
We’ll make sure to reach back as quickly as possible.
Hello! I’m the assistant Twinkie. How can I help?